The authorities either turned a blind eye to or helped finance scores of the settlements, according to extracts of the Sharon-commissioned report that were published in the Maariv newspaper on Tuesday.
The report is likely to embarrass Prime Minister Ariel Sharon's government.
The settlement division of the semi-governmental World Zionist Organisation "has systematically established illegal settlement points", the report, which was leaked a day before its official presentation to Sharon, said.
While the premier is committed to tearing down the outposts under the terms of the Middle East road map peace initiative, the report said government ministries had handed over millions of dollars to help finance their infrastructure.
The Education Ministry paid for nurseries and their teachers, the energy ministry connected outposts to the electricity grid and the government shelled out for the construction of roads, it said.
The report also detailed how senior army officers "reached quiet understandings" to allow the outposts to be established and how soldiers still guard them.
Abbas has called for an end to
settlements in the West Bank
Last week, Sharon vowed that settlement activity would continue in the West Bank and Jerusalem despite his intentions to evacuate all Jewish communities in the occupied Gaza Strip by the end of this year.
On Tuesday, Palestinian leader Mahmud Abbas called for an end to Israeli expansion in the West Bank and accused the Jewish state of dragging its feet over promises to kickstart the moribund peace process.
Palestinian Prime Minister Ahmad Quraya accused the world of doing nothing to thwart Israel and said the Palestinian Authority would appeal to the United Nations to stop settlement activity and its West Bank separation wall.
"The international community shuts its eyes and closes its ears to Israeli practices, putting us in an impossible situation," Quraya said after talks with EU special envoy Marc Otte in the West Bank.
"It is time for the international community to say enough to Israel and work with the same determination and seriousness as on other matters."
The report's author, former Justice Ministry official Talia Sasson, wrote that vague definitions of the boundaries of authorised settlements were exploited by the architects of the rogue outposts.
Settlement activity in West Bank
to continue, says Sharon
Her findings also exposed worrying ideological support for the unauthorised outposts - given the administration's commitments on the international stage - among several senior civil servants and Israel's military command.
The settlers council, which represents the fervent religious nationalism of Jewish communities in the occupied Palestinian territories, immediately dismissed the report.
"The report is nothing new. It shows up a vain desire to blame certain people and certain ministries," a statement said.
On the opposite side of the political divide, MP Yossi Sarid from the left-wing Meretz Party called for the parliamentary foreign affairs and defence committee to debate the report.
Under the road map, the government is obliged to dismantle all unauthorised outposts that have been erected in the West Bank since Sharon came to power in March 2001.
Israeli anti-settlement organisation Peace Now says there are more than 100 such outposts in the West Bank - generally set up as makeshift settlements with caravans but are often later "legalised" by the authorities.
"The international community shuts its eyes and closes its ears to Israeli practices, putting us in an impossible situation"
Palestinian Prime Minister
The group said recently that only three outposts had been dismantled in the past 10 months, with 51 of those remaining built since Sharon swept to power.
The international community considers all Jewish settlements in the occupied territories illegal. Washington has expressed dissatisfaction that Israel has not done more to dismantle the rogue outposts.